Trying to project when studios can make AAA VR games without funding from Oculus and Sony. (2020?)

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I’m doing some projections in a spreadsheet just for the hell of it.

Assuming the minimum spent on an AAA game is $20,000,000 (3 years with 56 people involved). If a studio is charging $60 for the game, they’d need to sale 480,000 copies to break even. Here’s a table with percentage of people needed to buy the game to breakeven, when the market has “x number of addressable devices”:

Number of addressable devices Attach rate needed to break even
8,000,000 6.00%
9,000,000 5.33%
10,000,000 (I think we’re here now) 4.80%
11,000,000 4.36%
12,000,000 4.00%
13,000,000 3.69%
14,000,000 3.43%
15,000,000 3.20%
16,000,000 3.00%
17,000,000 2.82%
18,000,000 2.67%
19,000,000 2.53%
20,000,000 2.40%
21,000,000 2.29%
22,000,000 2.18%
23,000,000 2.09%
24,000,000 2.00%
32,000,000 1.50%
38,000,000 1.26%
48,000,000 1.00%

Based on some quick reading, a break even attach rate of 1-2% is what most dev studios seem to be ok with risking. The 1-2% comes from console developers though. We the lack of AAA titles in VR, and I’d think that a good AAA game could easily bet on a 4% attach rate, due to lack of competition. Nintendo Switch has multiple titles with attach rates between 20-50%. I think games like Beat Saber, SuperHot, likely have have above a 4% attach rate

I estimate the entire size of the current 6dof VR market (PCVR, PSVR, Quest) is around 10 million units. I estimated 36% to be a reasonable growth rate for VR hardware across all brands next year (won’t go into that). If that’s the case we’d be around 14 million addressable units at the end of next year for the entire 6dof VR market. If a 4% breakeven attach rate is reasonable, it could make financial sense for studios to plan for a release date around September 2020 for AAA games if the total costs for the game ends up being around $20,000,000 to make. That’s assuming no funding help from platform like Sony/Oculus. It also assumes a steady level of competition which isn’t realistic if AAA game studios are planning titles around the same time.

It’d take around 3 years to get to 480,000 games sold to be a 2% attach rate if the VR hardware segment grows at 36%. That’s around September 2022

submitted by /u/ValveIndexFan
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